All Forum Posts by: Josh Prince

@Bryan N. - This is something I have struggled with myself. I am in Los Angeles, so the market is a bit different, I assume, but the issues are similar.

I have one agent who sends me good deals and a lot who send me crap. But I am happy to have anyone send me stuff, and I have made it clear I am not working exclusively with any one agent, but will buy from whomever brings a good deal. If I find it myself, I will usually use the listing agent. In any case, the seller is paying the commission, so I am not worried about how hard the agent is working.

I think it may be a little much to ask an agent to run financial calculations on a property, but maybe you can give a simple rough calculation for him, like a gross rent multiplier ceiling ("I don't want to buy anything that has more than a 8 GRM" or whatever your limit is). That is a very simple calculation for an agent to do and doesn't involve any estimation of expenses.

Then you can take this filtered list of properties and run a more in depth calculation and figure out if anything is good.

Finally, I don't think there is any harm in letting other agents in the area know that you are a buyer and that if they send you something good, you will move on it - if that is in fact true. Tell them you don't need an automatic MLS search, you already have that, but if they want to send you individual listings, you will definitely take a look, and with them, you can be very specific about what areas or what qualities you want.

Good luck, and I will be interested to hear what happens.

@Pat Marco Thank you very much for your thoughts in this thread. I am curious to hear more about how this works, practically speaking.

From what you say, it sounds like an ideal tax planning strategy. Do you have more specific information on the 1955 tax incentive so I can learn more about it?

Since this is a real estate forum, I am here becuase I am interested in real estate. I assume that this does not provide any tax benefit for income from real estate outside of PR.

If one establishes a Puerto Rican business entity as you described, does the income have to be Puerto Rico source income, or will this shelter income from anywhere in the US?

I find that the problem of the strategy of relocating to a low tax jurisdiction is that the taxpayer actually has to move there! For example, many people complain about high income tax rates in California and consider moving to a state like Nevada. However, few California residents who have established careers or businesses are inclined to move their entire life, family and business to a new state. it ends up being worth it to pay more in order to maintain their current lifestyle, keep their kids in the same schools, continue to socialize with their social network, etc etc. Also, California is a nice place to live for many people, and those people are willing to pay more to live there than Nevada - same with NYC and other high tax jurisdictions. Some individuals may argue that this is not the case for them, but generally, the reason that Los Angeles is an expensive place to live is that many people want to live there and are willing to pay for it.

No. Allodial title means ownership of land where no one else has any superior rights. That means no rent, no property tax, no ability of a government to seize, etc.

I have never found anything showing the details of what allodial title looks like under Texas law. That may be a myth. From researching the internet, the Nevada allodial title no longer is granted, and was primarily a way to prevent increased property taxes. Even what Nevada called allodial title was not true allodial title as the federal government could still seize the land under emminent domain laws, or the state could seize it under certain circumstances.

In the US, only the federal government has true allodial title, and perhaps some other government entities and the American Indian tribes come close. There is no way for a private individual to obtain allodial title, notwithstanding what some questionable websites tell you.

I have found (without making any assumptions about the OP) that when someone brings up allodial title, they are usually about two minutes away from talking about sovereign citizenship and why income tax is voluntary due to Ohio not being a state at the time the 16th amendment was ratified.

I have received these fees before and I have never been able to figure out if someone bumped the EQ valve or if it was just the "large truck" they speak of.

I usually just pay the fee because I don't want the tenant being incentivized to try to fix it himself and possibly break it next time in an effort to avoid the fee, but i suppose you could tell the tenant to suck it up and pay it.

Does the waiter at a fine restaurant work harder than the one at a neighborhood diner? Probably not, but the tip is a percentage of the total bill so the more expensive the meal, the higher the tip (all other things being equal).

Same with commissions on house sales. For whatever reason, it has become customary for real estate agents to earn a percentage of the sale when they sell the house, whether its $100,000 or $10,000,000. When the price gets REALLY high, like 10s of millions, the commission percentage drops, but $1,000,000 is right in the middle of this market.

You can try to negotiate with your listing agent for a lower commission but I would strongly suggest that you not do so in a way that causes the buyer's agent to receive a below market commission. I have seen buyer's agents pay less attention to homes that offer them a below market split (and not show them to their buyers!).

Can you explain the situation a little more? Is the owner going to be your tenant?

For example, Was the owner living in the unit, but now vacating?

You can charge market rent on the unit due to vacancy decontrol. In California, under the Costa-Hawkins Rental Housing Act, if an old tenant moves out you can charge whatever you want to the new tenant - you are not tied to the rent charged to the old tenant.

Or was the owner living in the unit and now remaining as a tenant?

The owner cannot be his own tenant under rent control, so you can charge him market rent on a new lease (and have no obligation to take him as tenant), unless you have a separate contractual obligation.

Or was the owner not living in the unit, but just charging a tenant (who is not the owner) a certain amount of rent?

In that case, as a basic rule, you have to keep charging the same amount of rent to the tenant as the previous owner was charging. You may increase rent a certain amount each year (3% for the last 5 years at least).

What made me a little alarmed was the minimal disclosure - the broker was representing himself as only the broker for a client who was a corporation - not specifically disclosing that he was associated with the corporation.

The letter made it seem like the broker had an arms length client who was interested in the building, but the client was listed as "[Corporation], et al." with "address on file" - basically giving minimal information.

Has anyone ever sent a partially executed purchase offer to someone, cold?

We recently updated the title on a house my family owns (removed dead trustee from title, etc) and then yesterday received a letter including a signed purchase offer from a broker.

The offer was all cash, 5 day inspection, 21 day close and required that we pay a 3.5% commission to the broker who sent it to us. The offer was for land value only, but it was way above market, or at least what I thought the market would be for land value for the house. This place is a total tear down relative to its neighborhood.

After some internet research I found out that the agent, the brokerage and the proposed buyer (who is listed "et al." on the offer) are all the same person.

Does anyone have an idea what is going on here? Is this person looking to tie the house up and then assign to someone else? Is it some kind of scam? Does anyone do this as a technique? From what I saw, I could have signed the offer and sent it back and it would have been binding. This is about 20% above what comps have sold for over the last year.

Thanks in advance!

Hi Dave,

I've been enjoying reading your thread. Thanks for sharing all of your valuable experience and information with us!

I have a general question: I have two plumbers that I use - one is cheaper and one is more expensive. I like the more expensive one because he seems to analyze the problem and put in a long term solution - (the cheaper one has been known to repair things with tape - but he is good for snaking clogs).

However I have started thinking that the more expensive one might be taking advantage of me - for example, if he says I need to have a fixture replaced and not repaired, or that I need to have some drains replaced, I usually just do it. Lately, most of my calls with him have turned into big projects - a clog is a drain replacement, a leaky faucet is a fixture and valve replacement, etc. I don't want to offend him - I know that I need both of them available when the tenant's kitchen is covered in sewage on christmas eve because of a mainline clog, but is there any way I can see if he is being honest or padding his projects?

Thanks again for this thread!